Last day to exchange your cryptocurrency for India

If you are a Bitcoin investor or any other cryptocurrency, today is the last day to monetise your investment in India as all the banks and financial entities will stop operating accounts linked to virtual currencies from tomorrow. Reserve Bank of India’s (RBI) deadline to banks to stop transactions with cryptocurrency exchanges is expiring today. The RBI in April had given a three-month buffer period to entities to end their business relationships with cryptocurrencies.

So, if you are still invested in any cryptocurrency, here’s what you should know:

No money transfer after midnight: Buying and selling in rupee are going to stop from midnight as banks and other financial institutions are not going to facilitate cryptocurrency trade from tomorrow. That means if you are still invested in any cryptocurrency you won’t be able to transfer the money in your bank account after midnight. India’s biggest digital currency exchange Zebpay recently asked its users to withdraw all their money before the deadline expires.

Peer-to-peer transactions: Investors would only be able to do peer-to-peer (P2P) transactions with a fellow trader. One would only be able to transact in the form of exchange with any another cryptocurrency. Some exchanges — WazirX and Koinex Loop — are working on peer-to-peer model that will allow transactions between buyer and seller directly with exchange being just a facilitator.

Rise of black market: RBI has banned banks from associating with cryptocurrency, not cryptocurrency. This may push holders of any cryptocurrency to approach buyers on marketplaces like OLX or black market to convert crypto to rupee, presumably at a higher price.

Bitcoins will turn costly: Any prospective bitcoin buyer in India will now have to buy it from peers, presumably after paying a premium over the current exchange rate.

Alternate trading methods: Besides peer-to-peer exchanges, some exchanges many also provide alternatives solutions like buying bitcoin in other currency like dollar through Paypal. This would, however, push the cost higher as one would have to pay extra charge on Paypal to transfer the dollar amount to your bank.

No Loans: Exchanges or cryptocurrency companies now won’t be able to avail loans or hold account in banks.

One Response

Also a new startup from crypto enthusiastics around the world is also going to facilitate it. A new service i’ve heard about is https://ripples.exchange, which is going to offer initially XRP’s (Ripple) peer to peer trading. I wish to get it started asap. 🙂